Türkiye’s Fund Coordination Board reviews payment schedule
ISTANBUL
Türkiye’s Fund Coordination Board, chaired by Vice President Cevdet Yılmaz, held its second meeting on Oct. 2 to discuss the payment schedule for fund accounts and a draft amendment to the Capital Markets Law.
On Sept. 30, the Capital Markets Board (SPK) approved interim payments of up to 1 million Turkish Liras per eligible investor in funds established by Tera, Pusula, Atlas and Hedef portfolio management companies that are undergoing liquidation.
According to a statement issued after the meeting, the Coordination Board reviewed the work being carried out by relevant institutions on the calculation methodology for net investment amounts under the SPK’s Sept. 30 decisions.
The board also assessed secondary regulations and the payment timetable related to the SPK’s decision on payments.
In addition, the board discussed a draft law amending the Capital Markets Law, which has been under preparation for some time. The statement said instructions had been conveyed to relevant institutions and organizations to finalize the draft.
“The necessary efforts regarding the resolution of problems that have emerged in a specific and limited segment of the fund market will continue swiftly and effectively within the framework of capital markets regulations, with due regard for fairness and justice,” the statement said.
The SPK said on Oct. 30 that payments will be made to investors whose account reconciliations have been completed and will be treated as advances against final liquidation proceeds.
The payments will be calculated based on each investor’s net investment amount determined by the Central Securities Depository (MKK). Investors with net investments below 1 million liras will receive the full amount, while payments for investors with net investments of 1 million liras or more will be capped at 1 million liras.
The liquidation process will begin with money market funds, while other funds will be liquidated according to investor numbers.
According to the SPK, 131 investment funds designated for liquidation hold approximately 826 billion liras in assets across 455,758 investors.
On Oct. 1, Finance Minister Mehmet Şimşek said in a social media post that stronger macroeconomic fundamentals and the measures being taken would limit the impact of recent developments on the financial system and the real economy.
The measures would also give Türkiye’s capital markets a stronger, healthier and more resilient structure, he said.
Meanwhile, speaking online at S&P Global Ratings’ 6th Annual Global Emerging Markets Conference on Oct. 1, Şimşek said authorities had moved swiftly.
“We acted very quickly. We “quarantined” the troubled portfolio management companies and the relevant funds,” he said.
Şimşek said the main objective was to prevent the problem from spreading to the rest of the financial system.
“Our aim here was to stop the contagion from spreading to the rest of the system, and I believe we have been largely successful in doing so,” he said.
“There has, of course, been a limited impact, but we are not talking about a systemic problem. We will continue to deepen the capital markets,” Şimşek added.